Hey all, forgive me if i'm posting in the wrong forum and if redirected to the proper forum. Looked around for a beginner's forum area but couldn't find anything. I'm trying to get my hands dirty in Trading but the biggest issue as with any beginner is having the starting funds to do so. I have about $5000 for trading to start with and looking for a way to begin. I've heard conflicting information on whether I should start instead with $1000 solely for learning purposes and expect to lose that. I'm not looking to get wild profits or anything in a short amount of time. My goal would be to learn to at least break even within a year and probably read/research for 6 months without even putting in money into an account. My question is $5000 okay to start with, granted I did a whole lot of research and practice, and increase my funds through that? I'm not looking to live off trading as I will be doing this part time with another part time job. I'm also really interested in swing trading but turned off because some have said you may have to have a bigger balance initially than you would need in day trading to make the same amount. Is this true? Thanks for the input.
Sounds good. Expect to loose your initial deposit, so make it 1k maximum to start off with. It needs to be a number that hurts to loose, otherwise it's like demo trading. Then see how it goes after you refunded the account with the second k Yes, your first goal should be to trade break-even. Choose a broker that lets you trade in 1k units.
Really open-ended question. It depends on so much. I guess in general I would think the least amount possible where you'll still "care" would probably be a good amount. I think it's dangerous for you to assume you'll be break-even or profitable after a year, or even after ten years, so the minimal amount possible for you to figure that out would be a good amount.
if he doesn't figure it out in 10 years then better stop or change course completely... break-even in 1-2 years is realistic.
Just to clarify to break even within a year is a goal I am aiming for, not necessarily what I'll assume I'll be doing. If I don't I'll reexamine this pursuit. Though I do agree it's a bit of vague question. It was just me trying to gauge a more realistic perspective of trading. Do you guys think swing trading is a possible option with this amount of balance?
Swing trading should be fine as long as you can trade in 1k units (if you're trading forex). I started with a 5k account and I usually had a maximum effective leverage of 5-8. I was able to swing trade comfortably with stops about 100 pips away (fx markets). If you have 1k available then this limits you to fewer simultaneous trades, which is good actually because most beginners tend to overtrade (me included). Again it depends on your broker and their minimum trade size
A potentially successful trader stats with smallest capital possible. in stocks a round lot is good in commodities a contract is good william J O'Niell is your best contemporary example. See around page 172 of his book entitled: "24 Ways.......". he spent 27 months and then took all capital to use to set up the IBD empire. the intial capital was 500 dollars. since I am older and more experienced than WJO'N, I started with less (300 bucks) I have connected with over 10,000 students. They all started with the least plus the knowldege and acquired skills to trade. You will not succeed as it turns out. Google "EMG". There re two reasons people have to trade. You have the wrong one.
Quite the bit for a couple trades, but I'll definitely look into it. Still got a lot of research and preparation ahead of me, but really appreciate the info. I'll most likely try out with 1k and see how it rolls out for practice first, but will research a lot before I even do that. Thanks!
Trade the Russell 2000 or S&P 500 emini with 1 lot until you grow your account. The products are already levered, highly liquid and you can trade different hours. Good luck
Very small account, definitely not good for trading any futures. I would focus on systems trading stocks, at least 100 of them. And you should work and risk in the way, that you will never loose you initial capital. My largest drawdown ever was 11% and it includes my starting account. Just do not overleverage and focus on consistency. If you can consistently make 15 - 35% per year, then you will be gzillionare very soon